Morgan Stanley Wealth Management Reports Record Revenues

Morgan Stanley reported record wealth management revenues in the last quarter.

The bank said its wealth management unit earned a total $3.8 billion for the fourth quarter of 2014, an increase of 3% from a year earlier. A report released early this morning also noted that wealth management had reached a record $14.9 billion in revenues for the year.

It was reported that client assets topped $2 trillion at the end of the quarter while fee-based accounts of $785 billion saw a 13% increase for the year. Fee-based assets also saw a record high at $20.8 billion. The firm said that pre-tax income rose to $736 million for the fourth quarter from $715 for the year-ago period, a 2.7% increase.

"It looks very positive overall," said Alois Pirker, research director at Aite Group, after reviewing the quarterly summary. "I'm most impressed in the inflow in the fee-based assets on the quarter at $20 billion. That is definitely quite the number."

Although the average annualized revenue per representative rose 5% to $944,000, Pirker noted advisor headcounts fell to 16,076, from 16,456 last year. Total client assets per representative were up at an average of $126 million, or a 9% total increase on the year.

"We delivered strong results across several of our businesses, although overall performance was affected by the choppy market conditions of the fourth quarter," said James P. Gorman, chairman and CEO of Morgan Stanley. "We also addressed a number of items that, while affecting our results in the short term, position us well in the years ahead."

The quarterly report comes after a recent data breach within the bank's wealth management division where it was alleged that a junior advisor stole information from 350,000 clients, or 10% of the company's wealth management accounts.

The break was discovered in late December when the advisor allegedly used his personal computer to download the information without authority to do so. The information later was put up for sale on the internet. The advisor, through his attorney, has denied he posted the data, or meant to sell it.